Tax on discount at purchase.
Note that the tax base may be reduced if the employee is required to pay health care contributions (which is likely the case).
Tax on sale.
No.
Social Insurance Contributions:
Yes, employee-paid health tax likely due on award income, but employer is not required to withhold.
The EU Prospectus Regulation is in effect in all European Economic Area countries, which includes all EU member states, Iceland, Liechtenstein and Norway ("EEA").
ESPP purchase rights are considered a public offering of securities for purposes of the EU Prospectus Regulation.
An EU-compliant prospectus will be required for the offer of an ESPP in any EEA member state, unless an exemption or exclusion applies. A "small offering exemption" is available if the offer is made to less than 150 persons in a member state. An "employee share scheme exemption" is available if the offer is made to existing or former employees (or directors), provided the offerees are provided with a short disclosure document that contains certain prescribed information about the offer. An exclusion for offers under a certain value threshold across the EEA may also be available.
An electronic notification to the Hungarian securities regulator is generally required within 15 days after the end of each purchase period.
Additional or different requirements may apply if relying on certain exemptions/exclusions or if a prospectus must be filed.
Please contact Baker McKenzie for more information.
Generally, no, provided US (or non-Hungarian) law is the governing law.
Discrimination against part-time employees is generally prohibited.
The EU Council Directive 2000/78/EC prohibits age discrimination. Most, if not all, countries have adopted local rules implementing this Directive, which may have an impact on design of equity and other incentive plans in the EU, particularly on age or age and service provisions which give different treatment (e.g., accelerated or continued vesting) for those meeting the criteria.
Employees must give special form of written consent to employer for payroll deductions, which should be translated into local language.
Deductions from salary taken on the basis of an employee's consent are only possible up to the so-called deduction-free part of the salary, i.e., generally 33% of the net salary (and, in special cases, 50% of the net salary).
A valid basis is required to collect, process and transfer personal data.
The EU Data Protection Regulation ("GDPR") became effective in all EU/EEA countries on 25 May 2018. It introduces new requirements and increases the powers of data protection authorities, rights of data subjects and potential penalties for non-compliance.
Accordingly, companies should review their approach to data privacy compliance in the context of equity plan administration and consider on which basis they may be able to rely to collect, process and transfer data.
Registration and notification requirements with local data privacy authorities may also apply.